Americans' Top 4 Financial Resolutions for 2022 -- and How to Achieve Them
KEY POINTS
- It's common to make New Year's resolutions for financial matters.
- A new survey reveals what moves Americans are pledging to make as 2022 kicks off.
Are any of these on your list?
The practice of making New Year's resolutions has been around for a long time, and it's a great way for people to set different goals and get motivated to achieve them.
You may have a number of objectives in mind for 2022, like exercising more, being in better touch with friends, or finally using your kitchen instead of ordering takeout all the time. But it also pays to set some specific financial resolutions at this time of the year. Here are Americans' most popular financial resolutions for 2022, according to a recent Principal survey.
1. Spend less money
It's not surprising that spending less tops the list of resolutions in this survey. Spending less money could be your ticket to meeting a host of goals, whether it's buying a home or paying off the balances you've been carrying on your credit cards.
If you're really invested in spending less, set up a budget to follow. That way, you'll see how much you can afford to spend in different expense categories, and you may also have an easier time identifying areas where you're able to spend less.
2. Put more money into savings
The pandemic taught us (the hard way) that having a decent amount of cash reserves is important. In fact, it's a really good idea to have enough money in your savings account to pay for three to six months of essential living expenses. That sort of emergency fund should cover you in the event of losing your job or facing a series of costly medical or home repair bills. Or, you may need it for random car repairs.
The point is that you never know what life might throw at you. And having more money in savings could help you not only meet different goals, but avoid debt when unplanned expenses mount.
3. Create a will, trust, or estate plan
You don't need to be wealthy to have a will in place, nor is it something you can avoid doing just because you don't have dependents. Without a will, you get no say in what happens to your assets after you pass away, so it pays to put that document in place.
Furthermore, if you want to secure your family's future, it pays to establish an estate plan, and a meeting with a lawyer could get the ball rolling. Some attorneys charge a flat fee for preparing a will and mapping out an estate plan, though the amount you pay might hinge on how complex your financial situation is. It's a good idea to schedule that meeting for the peace of mind it might give you.
4. Meet with a financial professional
There's absolutely no shame in enlisting the help of a financial advisor, whether you're new to the labor force or are nearing retirement and want guidance on how to plan for your senior years. You also don't need to be wealthy to benefit from working with a financial professional.
Quite the contrary – an advisor can help you make the most of your income and assets, no matter what they amount to right now. A financial professional can also help you set goals and map out a plan toward achieving them.
Your financial resolutions may look different from the ones above. If you're carrying a personal loan balance, for example, your primary goal may be to shed it in 2022. Or, you may have the goal of boosting your credit score or putting more money into your IRA or 401(k). No matter what you're resolving to do in the new year, it helps to put those goals in writing. Having that reminder could really help you stay on track and give you something to be proud of come this time next year.
Our Research Expert
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